Estate planning is the process involving the assistance of professional advisors familiar with your goals and concerns assets, how they are possessed and familial structure. This planning specifically covers the transfer of ownership of property after one’s death, while also handling a variety of personal matters. You have likely heard of a will, which is the core document that is created and dealt with during this process.
First, it is important to understand the significance of a will. A will basically provides the legal distribution of property owned by the deceased at the time of their death. Wills usually vary in complexity depending on the situation and the property owned by a person, and may be used to handle a wide range of family and tax objectives. Simple will is usually characterized as the outright distribution of assets, while a pour over will is when the will leaves probate assets to a revocable living trust. There is even a testamentary trust will, which creates one or more trusts upon one’s death, but the type of will you create is dependent upon the needs and wants of an individual. If one dies without a will, the state laws of descent and distribution will determine property distribution by default.
Next, it is necessary to understand and discuss power of attorney and how to choose your agent. A power of attorney provides one or more people the power to act on your behalf. However, this power may be limited to certain activities, or more general in its application. The power may also take effect immediately upon approval, but usually the power is chosen to take place upon the occurrence of a future event, which is typically when one is unable to act for oneself, particularly in the case of a physical or mental disability. This may be revoked, but a notice of revocation may be required to the person named to act for oneself. The power of attorney is typically referred to as an agent or attorney-in-fact. With a valid power of attorney, an agent may take any power permitted to them within the document.
Now, it is time to discuss the probate process. Probate is the formal legal process that gives recognition to a will and appoints the representative who will administer the estate and further distribute assets to the intended persons. Most probate processes are neither expensive nor prolonged, and vary on necessity from state to state. When planning your estate, it is important to minimize the real issues that could make probate difficult, whether than focusing on minimizing probate.
These terms are three of the biggest terms you need to understand to begin estate planning. However, this is nearly the tip of the iceberg as to what actually goes into estate planning, so it is important to begin to speak to a lawyer about estate planning whenever you feel ready.
Mestayer can help you with estate planning and editing any previous planning. Together, we will work with you to create the estate planning you need, and walk you through any questions or concerns you may have.